China decided to keep its benchmark lending rates steady during the monthly fixing on Tuesday, which was in line with the forecasts of the market. The one-year loan prime rate (LPR) remained at 3.35%, while the five-year LPR was also retained at 3.85%.
A recent survey by Reuters involving 37 market players revealed that all participants anticipated the preservation of both rates. The majority of loans in China, both new and existing ones, rely on the one-year LPR, whereas the pricing of mortgages is influenced by the five-year rate.
In a significant move in July, China took the markets by surprise when it slashed major short- and long-term interest rates. This action, the first of its kind in nearly a year, indicated the policymakers’ commitment to bolstering economic growth.
